Netflix confirms that an ad-supported level is actually happening

Netflix confirms that an ad-supported level is actually happening
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Netflix co-CEO Ted Sarandos confirmed that the company plans to introduce an ad-supported tier on its streaming service in an interview at the Cannes Lions ad festival. reports the hollywood reporter. the New York Times reported last month that the company aims to implement the new level by the end of 2022.

“We’ve left a large segment of customers off the table, which is people who say, ‘Hey, Netflix is ​​too expensive for me and I don’t care about advertising,'” Sarandos said. “Us [are] add a level of ads; we are not adding ads to Netflix as you know it today. We’re adding a level of ads for people who say, ‘Hey, I want a lower price and I’ll look at the ads.'”

The streaming service was widely expected to launch an ad-supported subscription tier for its service upon launch. other co-CEO Reed Hastings said he would be open to idea in april.

Netflix’s plans to launch the new cheaper tier follow news that it lost subscribers for the first time in more than a decade. Last room. The company reported a loss of 200,000 subscribers in the first quarter of 2022, compared to the fourth quarter of the previous year. It remains the largest streaming service with about 222 million subscribers, but the loss has forced Netflix to rethink its historically tough stance against ads.

Now the question is which ad sales company will Netflix partner with to help it get into the advertising business? Earlier this month, the Wall Street Journal reported that NBCUniversal and Google were two of the main contenders. When asked during the Cannes interview, Sarandos didn’t address who Netflix might partner with (“We’re talking to all of them right now,” he said), but suggested the company could use a partnership as a stopgap measure while it builds its own advertising business, according to the WSJ.

Sarandos was also asked if Netflix’s stock price could make the company a target for an acquisition. In response, the executive said “it’s always a reality,” but said the company has everything it needs to grow again on its own. he also fired recent rumors that Netflix could be looking to buy a streaming hardware company like Roku. “We don’t need it,” Sarandos said, according to the WSJ.

Netflix plans for a cheaper level with advertising, mirror those of rival Disney Plus, which also hopes to launch a similar offer later in the year. Disney’s ad-supported tier will come to the US first, before expanding internationally in 2023, and the company plans to limit ads to four minutes per hour. Prices for the new levels from Netflix and Disney have yet to be announced.

Divulgation: the edge He is currently producing a series with Netflix.

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